Business lending scheme a confession of failure

Ken Clarke, the Shadow Business Secretary, responds to reports that the Government plans to launch a "national investment corporation” - a new scheme to provide lending for small businesses.

"The trailing of yet another Government scheme to rescue small businesses from the credit famine from which they have been suffering for the last 12 months is rather pathetic", he said.

Clarke said that the scheme was "a confession" that the many schemes announced nearly a year ago "amid a fanfare of publicity" have  failed to achieve their aims.

He said that it has been "quite obvious throughout the last year" that many small businesses were struggling to survive because they were not able to obtain credit on a commercial basis at acceptable terms - "this has been a serious threat to the survival of our manufacturing base".

Clarke called on the Government to "simply admit they were wrong" and introduce "a straightforward National Loan Guarantee scheme" in the Pre Budget Report.